ENTREPRENEURSHIP Unit 1.3

1
ENTREPRENEURSHIPUnit 1.3

• Students will explore entrepreneurial
  opportunities

2
Students will explore entrepreneurial
opportunities

• Students will be able to
• Compare risks and rewards of owning a business
• Determine essential factors needed to choose type
  of business to start
• Assess business opportunities and trends, both
  domestic and global (include new and existing
  ideas, franchises, and web-based enterprises)
• Apply idea-generation methods
• Determine feasibility of ideas
• Outline available resources and government
  agencies to assist small business owners

3
Rewards of Owning a Business

• Being your own boss
• Doing something you enjoy
• Having the opportunity to be creative
• Freedom to set your own schedule
• Controlling your salary
• Contributing to the community

4
Risks of Owning a Business

• Working long hours
• Having an uncertain income
• Being fully responsible
• Risking ones investment

5
Types of Businesses

• Start your own business
• Purchase a franchise business
• Buy a new or existing business
• Entering a family business
• The new trend? Web-based business

6
Start Your Own Business

• Advantages
• Make all the decisions about everything
• Completely independent
• Disadvantages
• No certainty that customers will purchase what
  you offer
• Difficult to start a new business

7
Purchasing a Franchise

• Franchise Legal agreement that gives an
  individual the right to market a companys
  products or services in a particular area.
• Advantages
• Provided with an established product or service
• Offer management, technical, and other assistance
• Equipment and supplies can be less expensive
• Guarantee of consistency attracts customers
• Disadvantages
• Can cost a lot of money and cut down on profits
• Owners of franchises have less freedom to make
  decisions than other entrepreneurs
• Franchises are dependent on the performance of
  other franchisees in the chain
• The franchisor can terminate the franchise
  agreement

8
Franchise Opportunities

• Industries to Choose from
• Advertising Automotive Business Services
  Child Related Cleaning Computer / Internet
  Financial Services Foods Health Fitness
  Pet Related Video Retail Sports
  Recreation Senior Care Travel Vending
• Women-related

• Examples of Franchises
• Foods Industry
• Pizza Hut
• Baskin-Robins
• Carls Junior
• Quiznos
• Wendys
• McDonalds
• TCBY
• Can you think of some other franchises in
  different industries??

9
Purchase an Existing Business

• Advantages
• Already has customers, suppliers and procedures
• An established location
• May train the new owner experienced employees
• Prior records of revenues, expenses, and profits
• Substantial inventory and trade credit
• Financial arrangements can be easier
• Disadvantages
• May be for sale because not making money
• Serious problems may be inherited may have to
  market Under new Ownership
• Capital is required

10
Purchasing an Existing Business

• Ray Kroc of McDonalds purchased a hamburger stand
  from the McDonalds brothers

Ray Kroc
McDonalds Brothers
11
New and Existing Ideas

• Enter the Family Business
• Advantages
• Trust and togetherness
• Great potential for success
• Disadvantages
• Only 1/3 of family businesses survive after the
  2nd generation
• Never get away and take time off

12
Business Opportunities and Trends

• Home-based Businesses
• Businesses related to
• Technology
• Fitness and Health
• Indulgence Goods
• Ethnic Products
• Outsourcing
• Strategic Alliances

13
Web-based Enterprises

• Businesses that generate their revenue directly
  from their website fall into the web-based
  business category
• The following are web-based enterprises
• E-bay
• Monster
• Amazon

14
Global and Domestic Business

• Global
• A business that sells its product in more than
  one country.
• Importing Buying goods from other countries to
  sell in their own country.
• Exporting Selling and shipping goods to another
  country.
• Domestic
• A business that sells its product in its own
  country.

15
Creativity

• Whatever type of business you choose to do, you
  must think creatively about every aspect of your
  business

16
Idea-generation Methods

• Library resources can help you examine different
  opportunities
• Small Business Administration is a government
  organization that exists to help small businesses
  and their owners
• Talk to entrepreneurs and attend trade shows
• Start people watching
• Watch for demographic changes
• Become an insatiable reader

17
Feasibility of Ideas

• Once youve got an idea for your new business,
  you need to turn it into a business concept
• Business Concept Idea for a new business that
  can be tested.
• What is the product or service being offered?
• Who is the customer?
• What is the benefit you are providing?
• How will you get the product or service to the
  customer?

18
Feasibility of Ideas

• Feasibility Analysis The process used to test a
  business concept
• The analysis will show if there is enough demand
  for your product or service.
• Are there customers who want what you have to
  offer?
• What conditions must be present for you to decide
  to go forward with the business?

19
Feasibility of Ideas

• Ways of testing the business concept in the
  market are
• Feasibility Study Determines potential and
  profitability by
• Testing product or service requirements
• Talking to customers
• Studying the competition

20
Available Resources to Assist Small Business
Owners

• Friends and Family
• Local and Municipal Government
• State Government

21
Available Government Agencies to Assist Small
Business Owners

• SBA-Small Business Administration
• Federal government agency whose purpose is to
  help small businesses. Provide management and
  technical advice to owners of small businesses.
  They also guarantee loans made by banks. This
  means the SBA agrees to pay the bank loan if you
  cannot. The SBA will guarantee up to 90 of a
  bank loan.
• Click Here for Dixie Business Alliance
• Chamber of Commerce
• Click Here for St. George Area Chamber of
  Commerce
• State Governments
• Click Here for Utah Dept. of Commerce website

22
Lets Review

• Compare risks and rewards of owning a business
• Determine essential factors needed to choose type
  of business to start
• Assess business opportunities and trends, both
  domestic and global (include new and existing
  ideas, franchises, and web-based enterprises)
• Apply idea-generation methods
• Determine feasibility of ideas
• Outline available resources and government
  agencies to assist small business owners